March 28 (Bloomberg) -- Leeds United’s owner, GFH Capital, sold a 10 percent stake in the three-time English soccer champion to Bahrain-based International Investment Bank.
GFH Capital said it’s the first move in a long-term plan to bring “strategic investors” into the ownership of the team. IIB Chief Executive Officer Aabed Al-Zeera will join the board of the club’s holding company, the team announced on its website. It didn’t give financial details of the transaction.
The stake sale follows speculation over the future ownership of the club after conflicting statements from GFH Capital and its parent company over whether it would be sold.
David Haigh, deputy chief executive officer of GFH Capital, told the website that “the introduction of IIB is in keeping with what have always been GFH Capital’s aims for the successful, sustainable and long-term ownership of Leeds United FC.”
“We believe that a consortium of like-minded investors provides the best ownership model for a club which belongs among the elite of English football clubs and global sporting brands,” he said.
Leeds said other investors are expected to join as Dubai-based GFH Capital creates an ownership structure to provide “sound long-term finance” for a return to the Premier League.
“We are delighted to become investors in Leeds United and would like to thank GFH Capital for facilitating this for us.” Al-Zeera said.
International Investment Bank BSC was incorporated as an Islamic investment bank in October 2003, it says on its website.
Its core activities include “investment, underwriting and placement in real estate and private equity in conformity with Islamic Shariah.”
Yesterday, Bahrain’s stock exchange said the Gulf-based owner of Leeds hadn’t explained conflicting statements made about a possible sale of the club, now in England’s second tier.
GFH Capital, which bought Leeds less than four months ago, said last week it was seeking “investment in part of its share,” although not a full sale. GFH’s parent, Gulf Finance House EC, said in its 2012 financial statement released in February it was looking to sell the club within 12 months after securing it as a “bargain purchase.”
Leeds had success more than a decade ago, reaching the semifinals of Europe’s elite Champions League in 2001. The team stumbled into financial crisis by overspending on players, and dropped out of the Premier League in 2004. After falling into the third division and spending time in bankruptcy protection, Leeds is now 10th in the Championship, seven points below the playoff positions for a spot in the Premier League.
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